NZ stocks: Bad day for global telecoms

Telecom slipped 12c yesterday following a poor profit result and a global downturn in the industry which together brought the New Zealand sharemarket lower.

John Rattray of JP Morgan Chase said Telecom's fall to $5.20 was more due to the poor performance of the sector internationally than its 29.4 per cent fall in December quarter earnings.

Telstra had a larger fall, down 42c to $7.95.

The country's largest listed company reported revenue up 39.2 per cent to $1.38 billion, mainly due to the inclusion of Australia's AAPT in the figures - but expenses increased 65.6 per cent to $1.07 billion.

Telecom's shares have been on a roller coaster in the past 10 months.

The NZSE-40 capital index was down 10.87 points, or 0.55 per cent, at 1960.80. Turnover of 26.57 million valued at $93.48 million was led by Fletcher Energy, with $23.89 million turnover on 2.64 million stocks traded.

"If you take out Telecom, the rest probably neutralised. I would describe it as Telecom weak, the rest of the market reasonably flat," Mr Rattray said.

Sky TV was down 5c at $3.75, although Mr Rattray said the result - a loss for the half year to December of $19.6 million from $4.7 million a year earlier - had left the share unchanged from its early price.

Sky is 49 per cent owned by INL, a unit of Rupert Murdoch's News Corp, which was down 5c at $3.70.

Fletcher Energy was up 13c at $9.06 following a reasonable performance from US associate Capstone Turbines, and a fall in the New Zealand dollar to below 43USc.

Fletcher Forests rose 1c to 32c while Building stormed up 10c to $2.24.

Following the purchase of 51 per cent of Montana, ahead of a 100 per cent bid from British liquor giant Allied Domecq, Lion Nathan closed up 6c at $4.60 and Montana was down 1c at $3.85.

Biotechnology company Genesis rose 20c to $7.35 after announcing successful long-awaited phase two results in the US on its psoriasis vaccine, PVAC.

- NZPA